Sigma Designs Inc. said Tuesday it would sell one of its businesses to Silicon Labs Inc. and then liquidate, after failing to meet conditions of a full merger. Silicon Labs had agreed to acquire the Fremont, Calif., chip maker for $7.05 a share late last year, but said Tuesday that initial closing conditions for that deal could not be met. Instead, Sigma will sell its Z-Wave home-automation business to Silicon Labs for $240 million and enter liquidation proceedings with the goal of returning cash to shareholders. Sigma will look to sell or wind down other segments within the next year - for instance, Sigma said it would lay off nearly 300 of 416 employees in its smart-television and set-top box businesses. Sigma shares were halted ahead of the announcement Tuesday afternoon, while Silicon Labs stock was quiet in late trading after closing at an all-time high of $99.80.Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move. Visit MarketWatch.com for more information on this news.